(Alliance News) - Stock prices in London opened mixed on Friday as a European Union summit to agree a post-virus economic rescue plan gets underway.
However, negotiators of the deal ahead of the talks played down chances of an agreement.
In London, the FTSE 100 index was up 8.04 points, or 0.1%, at 6,258.73. The mid-cap FTSE 250 index was down 26.43 points, or 0.1%, at 17,294.86. The AIM All-Share index was flat at 876.13.
The Cboe UK 100 index was down 0.1% at 622.68. The Cboe 250 was down 0.1% at 14,696.10, and the Cboe Small Companies was down 0.1% at 9,178.11.
In mainland Europe, the CAC 40 in Paris was up 0.7%, while the DAX 30 in Frankfurt was up 0.8%.
All eyes will be on the crunch meeting of EU leaders in Brussels on Friday and Saturday, at which they will wrangle over a proposed EUR750 billion recovery fund to kickstart the bloc's battered economy.
The euro was changing hands at USD1.1429, firm from USD1.1419 in London.
Last week, European Council President Charles Michel proposed a EUR500 billion share of loans to EUR250 billion share of grants, building on a previous suggestion by the European Commission. He also slightly downsized the projected size of the EU's 2021-2027 spending plan from EUR1.100 trillion to EUR1.074 trillion.
This package suggestion will be at the centre of discussions to run Friday and Saturday. A deal is possible but far from guaranteed, according to EU sources and diplomats.
Negotiations will be "very difficult," but it is not only "about money, it's about people, about the European future, about our unity," a senior EU official said.
Analysts at RaboBank said: "Our view is that achieving the necessary unanimity of support behind this fund is unlikely to happen quickly and that the likelihood of a breakthrough at the July 17-18 summit is low.
"Irrespective of the speed of an agreement, we believe that the odds are clearly tilted in favour of the plan that is approved being notably diluted compared to its current form. We find evidence in support of the notion that the market is likely to be somewhat insensitive to such an outcome and that the key focus will be not so much the scale of funding on offer but rather whether the Rubicon of liability sharing is crossed."
In London, Homeserve was the best large-cap performer, up 3.5% after the home emergency cover provider said it has felt no effects from the Covid-19 pandemic.
Homerserve said "customer satisfaction is at record highs", reflecting strong service levels during the pandemic.
Further, M&A activity has restarted, it said, with a strong pipeline of targets and four profitable acquisitions completed in May and June, with the most significant of these bringing 38,000 new policy customers in Spain.
The home repairs and improvements company added that it continues to expect to deliver a solid performance in financial 2021.
Also in the FTSE 100, National Grid was up 1.5% after Deutsche Bank raised the UK power network operator to Buy from Hold.
In the FTSE 250, Ninety One was up 2.4% after the money manager, formerly part of Investec, posted a double-digit climb in assets under management during its first-quarter.
Assets under management rose 14% to GBP118.0 billion at June 30, from GBP103.4 billion at the end of March.
The second quarter of 2020, the first quarter of Ninety One's 2021 financial year, saw equities bounce as easing Covid-19 restrictions in some areas improved risk sentiment.
The Japanese Nikkei 225 index ended down 0.2%. In China, the Shanghai Composite ended down 0.2%, while the Hang Seng index in Hong Kong is up 0.6%.
The pound was quoted at USD1.2555 on Friday morning, down from USD1.2607 at the London equities close on Thursday.
The NHS will get an extra GBP3 billion in funding to prepare for a possible second wave of the coronavirus pandemic, UK Prime Minister Boris Johnson is set to announce, PA reports. In the wake of a dire warning of the consequences of Covid-19 rebounding, Downing Street said the funding will allow extra hospital capacity while allowing routine treatments and procedures to continue. The prime minister will also use a Downing Street press conference on Friday to commit to a new target of reaching the capacity for 500,000 coronavirus tests a day by November.
Against the yen, the dollar was trading at JPY107.18, marginally firm from JPY107.11, in London.
Brent oil was trading at USD43.18 a barrel on Friday morning, lower than USD43.72 Thursday evening. Gold was quoted at USD1,799.11 an ounce, down from USD1,805.00 an ounce.
In the economic calendar, there are eurozone consumer price index and construction output prints at 1000 BST. In the US, there is a Michigan consumer sentiment index reading at 1500 BST.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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